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PI Industries Ltd Analysis !!
#PIIndustries

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About -

Incorporated in 1947, PI Industries provides complex chemistry solutions in agri & pharma sciences. Over the years, the Co has successfully leveraged its capabilities across the Agri-sciences value chain by providing integrated and innovative solutions to its customers

by partnering with the best. Co has formed partnerships with leading companies globally where it provides solutions across the fields of R&D, regulatory services, manufacturing services, application development, marketing, distribution & customer connect initiatives.

Financial Summary -
Q4 FY22 (YoY)

Revenue were at ₹ 1415 Cr vs 1241 Cr
PAT at ₹ 204 Cr vs 180 Cr
EPS at ₹ 13.48 vs 11.95

Services offered by the company include:

• Contract Research & Manufacturing Services in the areas of Fine Chem, Agro Chem & Pharma intermediates.

• Crop protection, Specialty products, Plant nutrients & Seeds.

• Various grades of engineering plastics & compounds for the end use in Automobiles, Electricals, Home Appliances etc.

Business model built on the principles of respect for IP and established relationships -

~ Co is India’s largest CRAMS Company with majority revenue from Patented Products

~ Co is Leading Ag-chem Distribution Co in India with leading market share in certain crops

Domestic Brand Market -

Co demonstrating brand building capabilities & experienced team to deliver in licensed, branded generics etc.

Exports Market -

Co leveraging on chemistry process research
& manufacturing capabilities catering to Global Innovators for IP Creation.

In Lisencing -

• Co Introducing new products, partnering with
global innovators.

• Ensure longer product cycles by brand building.

• Develop solutions for the Indian Ag-chem
Industry with the partnership approach

Custom Synthesis & Manufacturing -

• Early stages of their life cycles

• Complex Chemistries

• Process development

• IP Protection & Generation

State of the Art R&D facilities -

~ Co has 400+ researchers & scientists

~ Accredited for GLP and ‘Norms on OECD Principles’ by NGCMA

Surge in new enquiries/products scale up driving the growth of CSM Exports :

~ Process Development -

• 9 new molecules commercialized in FY22

• More than 40 products at different development stages

• Pipeline has more than 20% non agchem products

~ Capacity Build up -

• 2 more Multi Product Plant (MPP) fully commissioned in the FY

• New chemistry building block (MMH) commissioned

~ Customer Acquisition/ Order Book -

• 36 new enquiries received: More than 35% from non agchem space

• 8 new customers were acquired during current fiscal

• Robust order book of ~$1.4 Bn

Portfolio of specialized products and robust pipeline of new products to drive growth in Domestic revenues :

~ Product development and Regulatory
approvals -

• Co has 15+ products at different stages of development & registration

• In FY22, Co received 3 regulatory approval

including the 1st product to receive MRL exemption in India

• 5 innovative products to be launched in FY23

~ Market Penetration -

• Nominee Gold® maintained dominant share among rice herbicides

• Positive momentum for Awkira® (pre-emergent wheat herbicide) with treated acres increase 3x

• Successful launch of Armatura® on grapes, a specialty fungicide with biological origin

• Successful launch of Distruptor® for control of rice Brown Plant Hopper (BPH)

Marketing & Distribution -

PI has a wonderful track record in building strong brands & delivering on its customer promise by leveraging the strong marketing and distribution set up. Co's marketing teams adopt a three-pronged approach in building powerful brands & creating

strong recall value for its products. Pre-launch efforts include mapping the target users & markets, on-field training, generating testimonials, brand awareness and teaser campaigns. The product launch campaigns include theme, location &venue finalization, stakeholder involvement

& press & media coverage. Whilst, the post launch efforts include exhaustive branding & promotional activities, channel handholding, demand generation activities, geographical & crop label expansion & product stewardship.

Some of PI’s major brands like NOMINEE GOLD, OSHEEN,

BIOVITA, COSKO, ROKET, KEEFUN, ELITE, HUMESOL have built a strong association with farmers & a strong recall value in the minds of the consumers. During the year under review, the Company has launched two new products namely AWKIRA & COSKO SC which received positive feedback from

farmers & channels alike. Inculcation of digital strategy to reach customer base efficiently and in time has added an edge to the marketing strength and the Company is ever poised to tackle the needs of changing markets.

Key Risks -

• Slowdown in crop protection chemical demand likely to impact execution of CSM business & thereby revenues

• Poor monsoon in India can impact India branded formulation business & thereby overall performance

Conclusion -

PI has levers in place to sustain the near-term growth momentum, led by:

~ Ramp-up in operations at two MPPs that were commenced in FY22

~ Sustained growth momentum in the CSM business due to a strong (USD1.4b) order book, rising pace of commercialization of new

molecules & sales ramp-up in existing molecules

~ Product launches in the domestic market (four new launches in FY22 and five new launches planned in FY23E), thus providing earnings visibility.

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